Direct Debit payment date Tesco Credit Card

Mum161111

I am just wondering:

Every month when my Tesco Credit Card statement arrives it always states: Minimum payment due on a specific date.  The statement date is always the same every month.

Every month, without fail, the  Direct Debit is taken about five days before the payment  date specified on the statement.  I have ticked to make payment in full every month but wonder why the Direct Debit is always taken in full but about five days early.  Payment is never taken on the date specified on the statement.

WillPS

They just do - Amex take theirs even earlier in the billing cycle. I believe there's some justification about giving you another chance to pay manually if the DD fails without missing a payment.

You can, if you prefer, cancel the DD and pay manually on a day of your choosing, but you'll be liable if your payment doesn't happen in time.

flaneurs_lobster

It's probably due to DD's taking ~3 days to clear into the payee's account, rather like BACS payments. If DD only activated on your account on the due date you'd be hit with interest charges. 

Mum161111

Thanks very much for replying, WillPS and flaneurs_lobster.  Although, thankfully, it is not a problem for me because I never run up a big bill and prefer paying in full by Direct Debit every month, I think it is a bit misleading.

With Barclaycard  taking over I wonder if the Barclay's  system is the same.  Years ago, before retirement, I had an M&S Credit Card and payment by Direct Debit was taken on the date specified on the statement - not before this date and I never had to pay interest. Thst was a long time ago and I accept that things have changed.

flaneurs_lobster

Could simply be how different organisations choose to run their collection systems. Large companies collecting thousands of DD payments daily tend to assume that any DD requested has been collected. They (or rather their system) only reacts when a "delinquent" report of a failed DD is received. If the nature of the business means that they have a low delinquency rate then they can afford to collect on or near the due date. 

molerat

It is not at all misleading, the date the DD will be taken is clearly shown on the statement.  The due date is the last date the payment has to be cleared into the account so they are simply using a system that ensures that, payments taken on the due date are technically late as they are unlikely to clear into the account by the due date.  Yes, many take it on the due date but that is their business decision to make.  Santander and Capital One are others that take it ahead of the due date.  By taking it early it also gives you a chance of making the due date if the DD fails because of something on your side.

Mum161111

molerat said:

It is not at all misleading, the date the DD will be taken is clearly shown on the statement.  The due date is the last date the payment has to be cleared into the account so they are simply using a system that ensures that, payments taken on the due date are technically late as they are unlikely to clear into the account by the due date.  Yes, many take it on the due date but that is their business decision to make.  Santander and Capital One are others that take it ahead of the due date.  By taking it early it also gives you a chance of making the due date if the DD fails because of something on your side.

It is not really clear on my Tesco Credit Card Statement, molerat.  It states clearly:  "Minimum Payment due by:  "date" and does not say exactly when the Direct Debit to pay "in full" will be taken.  I expected (wrongly) that, since I had ticked to pay in full by Direct Debit, it meant that the payment date on the Statement was the same date that the Direct Debit would be taken - no indication that the Direct Debit would be taken about five days before the date on the Statement.

I appreciate your reply, molerat, and I thank you.  Although I am grateful to be able to ensure that the money is available in my bank in advance of the (expected) date the Direct Debit will be taken, I really think that, given the information on the Statement, it is a bit misleading.

It may be that some could be caught out.  Even so, I am willing to accept Tesco's 'System.'  There are (less fortunate) people who are not allowed the privilege of being able to, as I do, and buy most of my groceries using my Tesco Credit Card, and not have to pay until the date of the Direct Debit.  For me, it helps me to budget on my low fixed income and I am grateful for that.  I have no significant debt to worry about.

I am appreciative of all the replies and hope it is all right to sometimes have a differet opinion.  I (genuinely) appreciate all the time and hugely helpful input you freely give to MSE forums, molerat, thank you.

Nasqueron

Mum161111 said:

Thanks very much for replying, WillPS and flaneurs_lobster.  Although, thankfully, it is not a problem for me because I never run up a big bill and prefer paying in full by Direct Debit every month, I think it is a bit misleading.

With Barclaycard  taking over I wonder if the Barclay's  system is the same.  Years ago, before retirement, I had an M&S Credit Card and payment by Direct Debit was taken on the date specified on the statement - not before this date and I never had to pay interest. Thst was a long time ago and I accept that things have changed.

I can never remember the details but Barclays is done on a fixed number of working days after the statement (or following working day if it falls on a weekend or bank holiday) so it varies - mine is usually 20th-22nd of the month. Barclays do take it on the due date though, not before.

Regardless even with Barclays taking over, it will be years, if at all, that their systems integrate so I wouldn't worry.

tizerbelle

Mum161111 said:

It is not really clear on my Tesco Credit Card Statement, molerat.  It states clearly:  "Minimum Payment due by:  "date" and does not say exactly when the Direct Debit to pay "in full" will be taken.  I expected (wrongly) that, since I had ticked to pay in full by Direct Debit, it meant that the payment date on the Statement was the same date that the Direct Debit would be taken - no indication that the Direct Debit would be taken about five days before the date on the Statement.

I have a tesco credit card - it tells you under the box that says Payment Due and Minimum Payment when your dd will be taken.  On mine (also pay in full) it says  "We will collect your full balance direct debit of £xxx.xx on dd/mm/yyy or soon after".

Mum161111

I've never noticed that before, thanks tizerbelle.   "I have a tesco credit card - it tells you under the box that says Payment Due and Minimum Payment when your dd will be taken.  On mine (also pay in full) it says  "We will collect your full balance direct debit of £xxx.xx on dd/mm/yyy or soon after". "

 I have never noticed it before.  I just checked my most recent statement and you are absolutely right:

In the main box in bold print it says:  "

New balance £ xx.xx

Payment due 11 November 2024

Minimum payment £ 25.00

and in very much smaller font, not emboldened it says: 

We will collect your full balance direct debit of £xx.xx

06/11/2024 or soon after.

Minimum Payments

If you make only the minimum payment each month, it will take

you longer and cost you more to clear your balance.

If you are unable to pay the minimum payment, please contact us

as soon as possible.

Thank you so much for bringing this to my attention, tizerbelle.  I really appreciate it.

tizerbelle

Mum161111 said:

I've never noticed that before, thanks tizerbelle.   "I have a tesco credit card - it tells you under the box that says Payment Due and Minimum Payment when your dd will be taken.  On mine (also pay in full) it says  "We will collect your full balance direct debit of £xxx.xx on dd/mm/yyy or soon after". "

When I can log in to my Tesco Account later today I'll check - but I am sure you are right and I have never noticed it before.

Jusat realised - I wasn't very clear - the message and dd date are shown on your statement not on the app home page.